• WisBusiness

Wednesday, April 29, 2009

Book review: "Catastrophe: The Story of Bernard L. Madoff, The Man Who Swindled the World"


By Terri Schlichenmeyer
by Deborah and Gerald Strober c.2009, Phoenix Books $14.95 / $16.95 256 pages
Ever play "Chutes and Ladders"?

"Chutes and Ladders", of course, was (and still is) a board game for small children. If you land on a square with a ladder, you move up the board quickly. If you land on a square with a chute, you slide back down just as fast. First to the top wins.

And that pretty much sums up the stock market lately. Up the ladder, down the chute, and few winners.

But some investors lost everything to someone authors Deborah and Gerald Strober say has been called the most hated man in New York. In the new book "Catastrophe", you'll read about Bernie Madoff, his scams, and his victims.

Bernard Madoff was born in 1938 in New York and was raised in Queens. Although he attended a close-knit high school, surprisingly few of his classmates remember him from then. His acumen with money wasn't obvious when he was in high school, but in 1960, he took $5,000, invested it, and founded Bernard L. Madoff Investment Securities, LLC, or BMIS.

Almost quietly, he began making his fortune. Madoff was doing things that few brokers were doing; some later called him a "pioneer" and a "financial wizard". Few experts had even heard of him prior to the 1980s. No one seems to know for sure when he started his Ponzi scheme.

When the scandal broke and Madoff was arrested, people were horrified to learn that the man they trusted was "a thief". Some lost millions of dollars; others lost everything, having turned over their nest-egg or their entire retirement fund to Madoff for investing. Most question whether he actually invested anything at all.

The list of victims reads like a Society Page: a senator, a filmmaker, actors, playwrights, Palm Beach residents, sports team owners. Madoff even swindled a 90-year-old man who considered Madoff "as a son".

But you know all -- or most -- of this. So why read the book?

Authors Deborah and Gerald Strober doggedly interviewed dozens of people who were victims of or knew Bernard Madoff, people who were affected by his actions, and a few who were able to see past his "charm". Although it dips into the melodramatic and sometimes reads like a supermarket tabloid, pulling all this information into one place makes this book an as-comprehensive-as-possible explanation of what transpired, given that we may never know for sure.

Surprisingly, religion comes into play a lot in "Catastrophe", and not just because Madoff is Jewish, as are many of his victims. The authors explore forgiveness, which is interesting since they include irate quotations pulled from other sources, as well as plenty of angry blog entries in this book.

In their afterword, they discuss how this happened, and they offer scenarios for what comes next in this drama and in the way we do financial business.

If you love to play the stock market, gambol in gambling, or otherwise sport with your savings, pick up "Catastrophe". This cautionary (true) tale proves that the game of finance is no game at all.

-- Schlichenmeyer has been reading since she was three years old and she never goes anywhere without a book. She lives on a hill in Wisconsin with two dogs and 11,000 books.

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Monday, April 27, 2009

Producing better-educated workers can help ease recessionary sting


By Tom Still
This recession has spared no group of workers when it comes to losing jobs, with white-collar workers who seemed nearly immune to past economic downturns standing in unemployment lines with their blue-collar counterparts.

Still, there's a clear "education gap" in the national jobless statistics -- and it's wide enough to buttress the commonly held belief that better educated workers are more likely to find work, earn a good wage and keep working when times get tough.

The gap should also reinforce efforts by Wisconsin policymakers and business leaders to support strategic ideas for building a better educated workforce, from K-12 programs that emphasize science, technology, engineering and math to targeted tax credits that can help older workers earn a college degree.

In February 2009, the U.S. Department of Labor reported that unemployment rates for people without high-school degrees was 12.6 percent, compared to 8.3 percent for those with a high-school degree only, 7 percent for those with some education after high school and 4.1 percent for those with a college degree.

Wisconsin ranks about 33rd among the 50 states in the percentage of adults with college degrees, well behind Minnesota (11th) and Illinois (15th). So perhaps it's no coincidence that Wisconsin's 9.4 percent jobless rate for March 2009 was higher than unemployment nationwide (9.0 percent), in Minnesota (8.2 percent) and in Illinois (7.3 percent).

Skeptics can make chicken-or-egg arguments all they want, but the fact is that "knowledge economy" businesses tend to cluster in cities and states where they can find workers who hold post-high school degrees. If you build the workforce, those businesses will come. Plus, knowledge-based businesses weather recessions better than most -- which means workers at those companies tend to keep their jobs.

What can Wisconsin do to build a better-educated workforce?

Click here to read Still's answers.

-- Still is president of the Wisconsin Technology Council. He is the former associate editor of the Wisconsin State Journal in Madison.

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Wednesday, April 22, 2009

Truth-in-auto-insurance provisions protect consumers


By Mark Thomsen
There is no question that as a state and a country we are facing some serious financial issues right now. Between losses in retirement savings, home values, jobs and income, it has never been more important for people to make sure their remaining assets are protected. Gov. Jim Doyle has taken an important stand to protect consumers in his proposed state budget by including a number of automobile insurance reforms. These "Truth in Auto Insurance" provisions will make sure consumers have adequate coverage to protect them from the real costs they could face if they are in a serious accident and to make sure that people get what they are paying for in their policy.

Not only do these changes make real improvements for consumers, they make automobile insurance work better for policyholders. It also helps control health care costs and saves taxpayers money too. Let me explain.

When a person is involved in an automobile accident and suffers injuries resulting in medical expenses, lost wages and other damages, these are real costs. If an automobile insurance company denies payment or pays an insufficient amount to cover these costs they don't simply go away. Once the insurance company takes the position that it is somebody else's problem, whose problem does it become?

If you have health insurance some of these costs are picked up here. The result is that you will see higher health care costs in the future. If you are working for a small business everyone in your health care pool gets to pay higher costs too. But health insurance often doesn't cover all the real costs so the injured party is often stuck with a big bill to pay. I bet it is no surprise that a recent Harvard study showed that about 50 percent of bankruptcies are a result of medical expenses.

Far too often the buck doesn't really stop until it hits the taxpayer. In many cases medical assistance and programs like SeniorCare or BadgerCare foot the bill for these unpaid insurance claims. Once again the automobile insurance companies don't really care who pays as long as it's not them.

The governor has proposed raising the minimum limits for auto insurance, which were set in 1982, to levels that reflect the real costs today. While our research shows this may cause a very modest increase in policy prices for the 20 percent of the policyholders that carry only the minimum required coverage, the resulting affect on health care costs and taxpayer savings will save us all money.

Since Wisconsin is one of only two states that does not make auto insurance mandatory, it is unfortunately those who buy automobile insurance that must bear the burden of personal responsibility for everyone.

Claims by the industry that prices will increase dramatically don't seem to match their other statistics where they try to say that very few people file claims for more than the current minimum level. Unfortunately, as is far too often the case it is difficult to know if and when they are telling us the truth.

The provisions included in Governor Doyle's budget go a long way in clarifying a number of other provisions as well and help bring back some honesty and fairness for policyholders and taxpayers alike. People deserve to get what they pay for when they purchase automobile insurance and to be told the truth about the coverage. The Truth in Auto Insurance provisions will protect policyholders and taxpayers, who certainly deserve our protection in these tough economic times if they are injured in an automobile accident. And taxpayers won't get stuck with the bill.

-- Thomsen is president of the Wisconsin Association for Justice, the state's largest voluntary bar organization defending the civil justice system.

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Tuesday, April 21, 2009

Book review: "What Would Google Do?"


By Terri Schlichenmeyer
by Jeff Jarvis c.2009, Collins $26.99 257 pages
How does a cheap, quick vacation sound this summer?

Pretty good, huh? A little fun, plenty of relaxation - but where to go?

Pop on your computer for inspiration, and you'd probably pull up Google. Type in a few words for some destination ideas. Google "flights" and "hotels", search museums, maybe get some tickets, Google your maps, make reservations, and there you are.

Vacation: planned.

Notice that? "Google" is not just a noun anymore... we "Google" something when we're looking for information. So how in the www did that happen? Better yet, how does it affect the way you do business? Find out by reading "What Would Google Do?" by Jeff Jarvis.

The first thing you need to know -- and you don't even have to search for it online -- is that if you give customers power, they will use it. That's something you want to happen: if you give your customers the power to offer feedback, tell you what to improve and tell you what they don't like about your product, you have valuable information you just got without paying a penny for a think tank or survey team. In this way, through honest communication, your worst customer becomes your best friend.

But rule number one won't work without rule number two: Pay attention. Read your customer's blogs, websites, and online comments about you. Don't ignore them, because they won't just go away. In fact, start a dialogue with your customers. Offer to fix every problem personally, then watch the negative comments turn golden.

Understand that "small is the new big", that the masses are now niches, and that you're throwing your money away if you don't go where your customers are. Embrace "free" as the new way to do business (think airlines, and the money they're making with a la carte pricing). Decide what business you're really in, and become the best at it. Give up control to gain your customer's trust.

"Make mistakes well," Jarvis says, and remember that life -- and business - are just ongoing experiments. Fail spectacularly and learn from it. Encourage... no, demand innovation from your employees, then get out of the way. Need to drag your business kicking and screaming into the 21st Century? Reading "What Would Google Do?" is as good a place as any to start.

While this book is heavily steeped in geekspeak (which may be hard for some CEOs to catch at first), it's filled with sound advice and real-life examples for working with and retaining today's computer- and internet-savvy customers (or Generation Google, as author Jeff Jarvis calls them).

In the last segment of his book, Jarvis gets brutally specific with industry-by-industry advice, which is not for the faint-hearted. If he's right -- and his track record is impressive -- you might not like what you read.

Not as techie as you want to be? Then read this book, read it again, and turn it over to your IT staff. Give them "What Would Google Do?", give your customers control, and they'll all know exactly what to do.

-- Schlichenmeyer has been reading since she was three years old and she never goes anywhere without a book. She lives on a hill in Wisconsin with two dogs and 11,000 books.

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Monday, April 20, 2009

A wake-up call from Louisiana


By James A. Buchen
The recent announcement that Thomas Industries plans to move nearly 300 manufacturing jobs to Louisiana and expand in that state is further evidence that Wisconsin's manufacturing economy is in crisis. Global and regional competition is increasingly heated as political leaders across the United States and around the world develop initiatives to attract and retain jobs for their citizens

Wisconsindoes not have a competitive business climate to begin with, and is lagging in developing initiatives to attract and retain jobs for its workers. In fact, policies pending today at the Capitol will make it harder for manufacturers to grow and create jobs -- billions in higher taxes, expanded liability, increased insurance premiums, mandated wage increases, and increased litigation regarding workplace complaints.

There's an odd disconnect between the 9.4 percent unemployment rate and the hemorrhaging manufacturing sector, and the governor's proposals to increase taxes, regulation and litigation for employers.

The numbers tell the story. Since the year 2000, when manufacturing reached an all time high of employment, Wisconsin has lost more than 140,000 manufacturing jobs. It has become increasingly difficult to replace high-wage manufacturing at the end of recessions. Click on the link to see the decline in manufacturing employment in our state since 1998: Wisconsin Manufacturing Employment Chart.

Earlier this week, Gardner Denver Inc., of Quincy, Ill., which operates Thomas Industries in Sheboygan, announced the relocation of the jobs to Monroe, La. The manufacturing jobs at the Sheboygan operation will be incorporated into the 76-employee facility in Monroe.

Thomas Industries currently employs 366 people in Sheboygan, of which approximately 280 are in manufacturing and related support roles. The other 86 employees are in sales, marketing, engineering, administrative and financial positions. The 280 manufacturing and related support positions are being relocated to Louisiana. The other 86 positions will remain in Sheboygan.

The Wisconsin manufacturing sector decline started well before the current recession. However, it has accelerated to the point where we currently have the lowest number of people employed in manufacturing since the government started keeping records. We are not just losing jobs due to the recession, but also because manufacturers find that they can be more competitive if they move jobs to other states.

In March, the manufacturing job loss led the all sectors with 9,000 jobs lost as Wisconsin's total unemployment rate hit 9.4 percent, the highest in a generation.

Ironically, one of the few sectors not to lose jobs in the last year was the public sector.

High-end manufacturing has historically been the backbone of the Wisconsin economy, providing the highest wages and best benefits of any economic sector. For many years Wisconsin has had the second most manufacturing intensive economy among the 50 states, ranking with Indiana and California.

Our high-end industrial economy provided jobs for manufacturing workers, and sustained a vibrant service sector. When manufacturing in our state is strong, it ensures we have a solid tax base to fund our schools, our roads and other government services.

Hopefully, this latest announcement will serve as a wake up call for policy makers that we need a dramatic change in our state's direction. The governor's proposal to increase the tax burden on Wisconsin businesses and investors by more than $1 billion is not going to help attract and retain jobs.

Fortunately, the state Legislature still has the opportunity to rethink state budget provisions and other pending legislation that will raise business taxes, increase business regulations, and encourage more litigation that targets both business and consumers.

WMC members agree that policies currently under consideration by the state Legislature will only serve to accelerate the pace of manufacturing job losses in Wisconsin. Wisconsin must begin to develop and implement a comprehensive strategy that will grow our economy and create high wage jobs in our communities.

In an effort to assist policy makers, Wisconsin's business community, in collaboration with a wide range of stake holders, has developed a package of policy initiatives entitled Moving Wisconsin Forward that can serve as a starting point for this important effort.

Everyone has a stake in improving the business climate and creating jobs in Wisconsin. That is why we all need to talk to our elected officials and encourage them to rethink the budget proposals that will most surely cost us jobs. We need to focus their efforts on growing the economy for our families, our communities and Wisconsin's future.

-- Buchen is vice president of government relations for WMC, which represents 4,000 businesses in Wisconsin. WMC is dedicated to making Wisconsin the most competitive state in the nation.

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Friday, April 17, 2009

Lights! Camera! Inaction? State film tax credits stir debate


By Tom Still
Mention Hollywood and politics in the same sentence and most people envision liberal screen stars lining up on Rodeo Drive to save a whale, rescue a polar bear or hug a Democrat.

That stereotype is flipped in Wisconsin these days, where a conservative Republican state senator has emerged as a leading defender of current state tax incentives for the film-making industry and the Democratic governor has cast himself as a major skeptic of doing business with Tinseltown.

Sen. Ted Kanavas, R-Brookfield, believes the film tax credits he championed in 2006 are creating jobs and bringing dollars to Wisconsin, while Gov. Jim Doyle thinks the program he signed into law that year has failed to live up to its hype and should be left on the cutting room floor. It may not be the biggest issue in the state budget bill -- but it illustrates the difficulty of targeting state economic development dollars, even when intentions are good.

The state Department of Commerce issued a report last month on the film tax credits and the conclusion was harsher than reviews of "Meet the Spartans." Simply put, Commerce believes the tax credits cost more than they're worth in economic benefits.

The report called the program "really expensive" because it's not a typical tax credit program, which is capped at a percentage of taxes paid, but a refundable tax credit program that can act almost like a blank check. If the refundable tax credit exceeds the recipient's actual tax bill, the state writes a check for the difference. In Louisiana, that very scenario may cost that state's taxpayers more than $20 million.

"The program's cost-benefit analysis compares poorly to other programs aimed at manufacturing, technology, and agriculture," the report concluded. "In fact, Commerce can offer much more assistance to a film or video game than a manufacturer, a biotech start-up, or a cheese plant."

Click here to read the rest of Still's piece.

-- Still is president of the Wisconsin Technology Council. He is the former associate editor of the Wisconsin State Journal in Madison.

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Unleash your employees to take your company into social media


By Steve Jagler
To Tweet or not to Tweet? That is the question. Perhaps more generally, the question every business must ask itself right now is whether or not it wants to engage the company and/or its people in social media.

As the cover story of this week's BizTimes Milwaukee documents, many southeastern Wisconsin businesses are delving into social media networks such as Twitter, LinkedIn and Facebook.

Some are finding ways to actually make money out of their social media connections. Others are building their networks and planting seeds for future relationships and -- hopefully -- new business.

Like many of the issues we cover, BizTimes Media LLC also has been grappling with the same questions are readers are pondering. With regard to social media, we made the strategic decision a month or so back to just do it.

I've instructed our people not to obsess over it. It's just another emerging tool, and for now, we just need to be in the game.

I do not consider myself a technogeek. Nor am I a technophobe. Maybe just a slow adopter would be the right description.

Fortunately for me, we have a staff of Gen Y folks who are fearless when it comes to technology. So, they just decided to take us where we need to go.

Click here to read the rest of Jagler's piece.

-- Jagler is executive editor of BizTimes Milwaukee.

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Thursday, April 16, 2009

Operators see state efforts aiding summer tourism


By Jennifer Sereno
With an annual impact of some $13 billion per year, Wisconsin's tourism industry represents an important source of jobs and income for state residents.

In Wisconsin Dells and northern communities including Minocqua and Hayward, tourism and its ripple effects sustain families, support the local tax base and create opportunities for new generations of entrepreneurs.

On a national level, however, tourism industry forecasts for 2009 are not exactly glowing. The U.S. Travel Association predicts leisure travel this year will decline approximately 1.4 percent from 2008, which was itself a challenging year.

While traveler sentiment appears to be strengthening based on the association's most recent quarterly index, much of the improvement in attitude is attributable to the industry's aggressive promotion of discounted rates and fares. The association notes that some hotel companies, attractions and rental car companies have been featuring deals up to 50 percent off those quoted six months earlier.

So, what does all of this mean for Wisconsin tourism operators in the critical summer months ahead?

Several regional experts say despite the recent media flap over Wisconsin's new tourism slogan ("Live Like You Mean It"), efforts to promote the state are having a positive impact. While 2009 won't be an easy year, savvy tourism operators throughout Wisconsin are adapting to the changing demands of visitors and looking forward to the summer season with some optimism.

Kevin Ruetten, executive director of the Hayward Area Chamber of Commerce, says the year started off on a high note in his region, with record participation in the American Birkebeiner ski race and its sister event, the Kortelopet. The Birkie and its related festivities drew 15,000 to 20,000 people to the region for a $4 million economic impact. Then, before the spring thaw, nationally sanctioned snowmobile events drew 12,000 to 14,000 people, including many national caliber snowcross competitors.

Events coming in the warmer months, including the governor's fishing opener in early May, the musky festival in June and the 50th anniversary of the Lumberjack World Championships in July, all have tourism operators upbeat.

In addition to these signature events, "we do have a lot of attractions up here that maybe don't cost as much as the attractions elsewhere," Ruetten says. "People can spend time and not as much money, so we're fairly optimistic. Some of the resorts aren't totally full yet, but the calls are still coming in."

Although the Hayward area continues to exude "small-town" friendliness, more establishments have invested in wi-fi capabilities and high-speed Internet access while pressing the phone companies to ensure better cell reception. Given that a missed message can mean lost business these days, such amenities have become increasingly important to working families.

In Vilas and Oneida counties, restaurants, resorts and attraction operators also are optimistic. With gas prices running more than a dollar below last year's levels, the owners of vacation homes in the area may opt for additional trips. Meanwhile, families within a day's driving range gain an incentive to book a resort closer to home instead of a flight to a more distant destination.

"Among the resorts, a big portion of them are very pleased with their bookings for this summer," says Dianna Lang, director of customer relations for the Minocqua-Arbor Vitae-Woodruff Area Chamber of Commerce. "There are some that are a little slow, but those are the ones that don't have bookings in the first part of June and last part of August. We have to keep in mind that many schools are still in session during the first part of June ... and then lots of schools start sports in early August."

Lang says North Woods tourism operators also recognize that changing family dynamics have upped the ante when it comes to offering activities everyone can enjoy. Gone are the days when mom and the kids were content to stay at the cabin playing board games while dad went fishing. Instead, many families are eager for options ranging from outdoor water sports and recreational trails to shopping, indoor pools and game rooms.

Of course, fishing in the area continues to be exceptional, and there's no better place to enjoy a game of cards or backgammon than on a cabin porch overlooking a northern lake, Lang notes.

Ruetten from the Hayward area and Diane Geis-Hapka, executive director of the Minocqua area chamber, both credit the state tourism department for drawing more visitors from targeted out-of-state markets. Although many Wisconsin residents never get to see the ads that play in these regional markets, Geis-Hapka believes they are effective.

"We do get calls and when we ask people where they found our number, a lot of times it's from the Wisconsin Web site," Ruetten says. "We've seen an increase in the number of visitors from Iowa and Missouri, although one of our major markets is the Minneapolis-St. Paul area. When the state launched the new (tourism) tagline, they also announced the launch of improvements to the (industry tool portion of the) site to make it easier to use. I've heard in the industry that a lot of people have liked the improvements."

-- Sereno, former business editor of the Wisconsin State Journal, is a senior manager at Wood Communications Group in Madison. E-mail jenny.sereno@wcgpr.com or call (608) 770-8084.

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Tuesday, April 14, 2009

High-net worth individuals can survive the death tax with qualified personal residence trust



By Kevin Reardon
The Obama administration has indicated its plans to block the estate tax from disappearing in 2010, though to offer a bit of relief, it might freeze it at the rate and exemption levels that took place this year. That would mean that estates worth up to $3.5 million for individuals and up to $7 million for couples would be exempt from any taxation and those above those amounts would be taxed at 45 percent.

Bearing these things in mind, high-net worth individuals should consider a Qualified Personal Residence Trust.

Even with the downturn in the real estate and stock markets, now is a good time for high net-worth individuals and couples to look at ways to shelter their estates from the possibility of taxes going forward. A QPRT is a trust that owns the home at a discounted value for a specific term while allowing the parents to continue living in the home.

The QPRT works best for those people who expect to live another decade or so. The longer the term of the trust, the greater the benefit to the children. But a word of caution: if one or both of the parents die before the trust expires, the heirs have to pay the estate tax on the value of the house at the time the parent died. Such a trust has to be set up carefully with a thorough review of actuarial tables and a discussion of each parent's financial history.

Technically, QPRTs make the most sense when interest rates are high because the higher the interest rate, the greater the discount applied to the property, which, in turn, increases the tax savings. A QPRT is based not on the current value of the house at the time the trust is being written but what is determined to be the present value of a future gift. This is actually a discount to the current value. When a home is put into the trust its value is not the current value of the house but, rather, what is called the "present value" of the future gift -- a decrease of 25-50 percent in value.

The Internal Revenue Service calculates these formulas so ask your expert how current calculations will affect the value of your estate.

Another potential benefit of the QPRT is that, if the parent runs into trouble with high hospital or medical bills, the hospital cannot demand any money gained by refinancing or selling the house because the occupant does not have any right to that money.

Finally, should the parent outlive the trust, the parent can continue to live in the house by paying the kids fair-market rent. What's more, if the kids want to avoid income taxes on the rent they'll receive from their parents they can form a grantor trust for the property so the rent is paid to the trust.

-- Reardon is owner & president of Brookfield-based Shakespeare Wealth Management Inc.

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Monday, April 13, 2009

Refinancing now could help protect you against future inflation


By Kevin McKinley
The first half of the last decade caused many homeowners around the country to believe that there would never be a better long-term investment than owning a home.

In the last five years or so the same group is wondering whether their respective homes will ever sell for the prices seen at the peak of the boom, or even for what the tax assessor seems to believe the houses are worth right now.

If it makes you feel any better, recent developments have made it more likely that your house will be worth much more in the future -- just not in a way that will make you feel any better about it.

Here's why, and what you should do now to improve your odds of making more money on your most precious "investment."

Some help from Uncle Sam

A few weeks ago the Federal Open Market Committee announced plans to purchase hundreds of billions of dollars of Treasury and mortgage-backed securities.

In the short term, one of the effects of this move was that long-term interest rates dropped to lows never seen before -- especially on 30-year home mortgages.

The financing giant Freddie Mac said that the 4.85 percent rate available nationally on 30-year loans was the lowest since they began tracking it almost forty years ago.

Low rates = higher inflation?

The larger and longer economic affect of this flood of money into the markets is uncertain. But a probable outcome is that we'll see higher inflation at some point in the future.

That means that dollars will continue to decline in value (meaning that in the future it will require more dollars to buy a certain set of goods and services than it would to buy the same set today).

So the home you own today might be worth more dollars in the future, but those dollars will be worth less (and hopefully not worthless).

In other words, if you sold your home today, the proceeds might allow you to buy more goods and services now than if you sold your home in the future -- even if the dollar amount of the future sale is much higher than what you could sell your home for today.

Whipping inflation then

Another reason that you may not see large, long-term increases in home prices is that when the Federal Reserve tries to slow or halt inflation, the primary tool they use is raising interest rates.

Although this move is usually effective in eventually slowing inflation, it also tends to put the brakes on the economy, which tends to put the brakes on rising home prices.

To make matters worse for homeowners hoping for increasing home prices, rising interest rates also means higher mortgage rates, which, all other things being equal, likely means lower home prices, as well.

What you can do

There are a couple of strategies some investors use to hedge against the prospects of inflation, including the purchase of gold or other precious metals, or buying into a mutual fund that trades in commodities or natural resources.

But one of the simplest ways to partially protect yourself against the ravages of inflation could also be one of the smartest.

How? By taking advantage of the aforementioned record-low mortgage rates to refinance your home mortgage, or even take out a new one.

It's certainly not a move for everyone. But if you are one of the relatively few, and the inflationary scenario comes true, in a few years you'll find yourself making mortgage payments that are technically for the same fixed dollar amount, yet in reality those dollars will be worth less and less as time goes on.

Meanwhile, the cash that you receive from your home equity today can be used to improve your money situation now, as well as provide a cushion against inflation and other future financial calamities.

But what you do with those proceeds is very important. Next month you'll find out if you should even consider opening up a new 30-year mortgage, and, if you do, what your best bets will be with the money you receive.

In the meantime, you may want to make an appointment with a friendly lender at a local bank or credit union.

-- McKinley bought his first share of stock at the age of 14, and began working for an investment firm at 17. After graduating from the University of Wisconsin with a degree in economics and history in 1988, he became one of the youngest licensed financial advisors in the country. He is now a Certified Financial Planner practitioner, and owner of McKinley Money LLC, a registered investment advisor in Eau Claire, Wisconsin that provides fee-based financial planning and investment management to individuals and families. Read McKinley's complete bio

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Thursday, April 9, 2009

The vital economic recovery value of Greater Wisconsin public universities and colleges


By Richard H. Wells
Many people understand and value major research universities such as the University of Wisconsin-Madison and UW-Milwaukee and their impact on economic growth and recovery. However, the "Greater Wisconsin" public universities and colleges that serve more than 100,000 students and 60 percent of the state's residents are regional educational, research, cultural, and economic bedrocks. These institutions greatly impact the long-term regional economic development strategies for Wisconsin through workforce development, business enterprise services and regional community enhancement.

The UW System institutions drive the economy and enhance the state's competitive edge by increasing the number of college-educated employers and employees. In the past eight years, enrollment at UW Oshkosh, the state's third-largest university, increased from 11,700 to 12,700, and the number of degrees conferred increased by 23 percent. Our certificate, professional, undergraduate and graduate programs are highly aligned with regional economic needs and contribute directly to workforce development by educating more and better-prepared graduates to fill existing and future jobs.

UW Oshkosh leverages its knowledge assets through innovative collaborations with 13 public universities and colleges in the Northeastern Wisconsin Educational Resource Alliance (NEW ERA). We also maximize our impact on business enterprise and regional economic development as a member of New North Inc., a consortium of private and public sector, educators, business leaders and economic development professionals throughout the 18 counties of northeastern Wisconsin who work together for the purpose of sustaining and growing the regional economy.

More than two dozen concrete examples of academic programs that are highly aligned with regional needs are detailed at http://www.uwosh.edu/news/wp-content/themes/tma/images/JFCHighlights.pdf. Additionally, some recent innovations include the following:

* A Bachelor of Applied Studies (BAS) program enables technical college associate degree holders to move into business leadership positions.

* The Accelerated Online Nursing Degree Program allows students who have earned a baccalaureate degree to earn a BSN. The program produced 300 additional nurses since 2004 without a single dollar of state funding.

* Alternative Careers in Teaching (act!) addresses a shortage of science and mathematics teachers in middle and high schools by allowing bachelor degree holders to earn teaching certificates. The UW Oshkosh Robert Noyce National Science Foundation grant provides 50 $10,000 scholarships that enable bachelor's degree holders to prepare for new math- and science-teaching careers.

* A Collaborative Online MBA Program, offered in three locations and online, allows 500 Wisconsin residents to earn a highly accredited advanced business degree.

UW Oshkosh has launched several recent innovations for enhanced alignment with business enterprise needs including:

* The Wisconsin Family Business Forum assists about 400 Wisconsin entrepreneurs in dealing with issues unique to running a family business.

* The Yahoo! Global CareCenter, a collaboration with UW Oshkosh's Center for Community Partnerships employs UW Oshkosh students and provides technical support to some of Yahoo!'s 17,000 employees. This semester the 35 students who work part-time in the Yahoo! Global CareCenter receive a laptop computer and earn $10,000 annually, which covers 75 percent of their total annual costs to attend UW Oshkosh.

* The Center for Community Partnerships provides customized training, faculty consultants and student interns/consultants for the needs of business and public sector organizations, including Oshkosh Corporation, Mercury Marine, Plexus and Kimberly-Clark.

UW Oshkosh's economic impact of $500 million a year increased by 16 percent from 2003-2006 and is projected to continue to increase another 16 percent -- or $80 million -- by 2010. The University is directly and indirectly responsible for creating 9,000 plus jobs and generating more than $37 million in state and local tax revenue. Thousands of construction-related jobs are expected to be created during the next two to three years. The University's unparalleled educational, cultural and economic value for its hometown and the New North region has never been of more vital importance during its 138-year history.

Although the "Greater Wisconsin" institutions -- UW Oshkosh, its 10 sister regional comprehensive universities and the UW Colleges -- are being asked to cut up to $85 million during the 2009-11 biennium, they will continue to deliver their outstanding economic recovery value. However, we hope the Governor and Legislature can find a way to reduce the budget cuts so as to enhance our economic recovery and development impact. The kind of impact that UW Oshkosh has brought to bear in the New North is repeated across the state by the "Greater Wisconsin" institutions. Each one is a storehouse of innovative and collaborative programs that are aligned with regional needs for workforce development, business enterprise support and community growth. Together these institutions play a crucial role by providing vitality to the "Greater Wisconsin" regions that stabilize and balance out the state.

-- Wells is chancellor of the University of Wisconsin-Oshkosh.

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